Hotel Feasibility Study in the Orlando-Kissimmee-Sanford, FL Metro Area

A hotel market that borrows heavily and seldom

Orlando is known for hotels, yet in SBA's records the location quotient is only 0.64x: hotels and motels take a smaller share of local SBA loans than of the national book. Other classes crowd the local list, and hotels rank 10 of 39 here, while the metro as a whole is 23 of 807 for hotel loans. The cell stands out for size. The median loan of $3.1 million is 1.43x the national median, and the 66 loans approved in FY2017 to FY2026 total $207.0 million.

Brands, building loans and the lead CDC

Loans in the middle half span $2.0 million to $4.4 million. Program counts are 45 for 7(a) and 21 for 504, a heavier 504 weight than most classes, which fits property with large real estate cost. Franchise units account for 69.7% of loans, so flagged brands finance most of the stock. Florida Business Development Corporation is the certified development company with the largest presence, 10 loans worth $30.1 million, a record SBA keeps and not a ranking of quality. By county, Orange County has 30 loans, Osceola County 18, Lake County 12 and Seminole County 6.

The industry code shelters hotels and motels together, so the rows mix full-service resorts with small roadside motels. Annual counts that are shown: 11 loans in FY2017 ($19.9 million), 12 in FY2018 ($35.6 million), 9 in FY2019 ($25.4 million), 5 in FY2021 ($18.0 million) and 6 in FY2024 ($18.3 million). The counts for FY2022 and FY2023, with FY2020, FY2025 and FY2026, are withheld because too few loans support them, which does not mean no hotel loans were approved. This cell has no usable cancellation floor and no charge-off floor. Whether a hotel loan counts toward this metro is decided county by county, from the project's location.

What a hotel study here has to test

A hotel study in the Orlando area must separate leisure demand from business demand and show how the property earns when leisure travel softens. It has to test average daily rate and occupancy against the competitive set, the brand's fees and product standards, construction or renovation cost against a ticket that routinely runs into millions, and debt service coverage through a slow ramp. Where a 504 loan finances the building, the study should reconcile property value with going concern value, because an appraiser will. Nothing on this page predicts an approval.